UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-32587

ALTIMMUNE, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware		20-2726770
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

910 Clopper Road Suite 201S, Gaithersburg, Maryland		20878
(Address of Principal Executive Offices)		(Zip Code)

(240) 654-1450

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.0001 per share	ALT	The NASDAQ Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ⌧ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	◻	Accelerated filer	◻
Non-accelerated filer	⌧	Smaller reporting company	⌧
		Emerging growth company	◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ⌧

As of May 5, 2023 there were 49,292,189 shares of the registrant’s common stock, par value $0.0001 per share, outstanding.

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ALTIMMUNE, INC.

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		Page

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements	1

	Consolidated Balance Sheets as of March 31, 2023 (unaudited) and December 31, 2022	1

	Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2023 and 2022 (unaudited)	2

	Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2023 and 2022 (unaudited)	3

	Consolidated Statements of Cash Flows for the three months ended March 31, 2023 and 2022 (unaudited)	5

	Notes to Consolidated Financial Statements (unaudited)	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	19

Item 4.	Controls and Procedures	19


PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	19

Item 1A.	Risk Factors	20

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	20

Item 3.	Defaults Upon Senior Securities	20

Item 4.	Mine Safety Disclosures	20

Item 5.	Other Information	20

Item 6.	Exhibits	21

	Signatures	22

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

ALTIMMUNE, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per-share)


	March 31,		December 31,
	2023		2022
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	104,690	$	111,097
Restricted cash		34		34
Total cash, cash equivalents and restricted cash		104,724		111,131
Short-term investments		61,039		73,783
Accounts receivable		252		173
Income tax and R&D incentive receivables		3,118		2,368
Prepaid expenses and other current assets		3,978		5,358
Total current assets		173,111		192,813
Property and equipment, net		1,007		1,081
Indefinite-lived intangible asset		12,419		12,419
Other assets		546		615
Total assets	$	187,083	$	206,928
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	5,238	$	4,804
Accrued expenses and other current liabilities		9,713		12,250
Total current liabilities		14,951		17,054
Other long-term liabilities		4,400		4,581
Total liabilities		19,351		21,635
Commitments and contingencies (Note 11)
Stockholders’ equity:
Common stock, $0.0001 par value; 200,000,000 shares authorized; 49,286,710 and 49,199,845 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively		5		5
Additional paid-in capital		570,786		568,399
Accumulated deficit		(397,958)		(377,884)
Accumulated other comprehensive loss, net		(5,101)		(5,227)
Total stockholders’ equity		167,732		185,293
Total liabilities and stockholders’ equity	$	187,083	$	206,928

The accompanying notes are an integral part of the unaudited consolidated financial statements.

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ALTIMMUNE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

(In thousands, except share and per-share)


	Three Months Ended
	March 31,
	2023		2022
Revenues	$	21	$	32
Operating expenses:
Research and development		17,249		15,104
General and administrative		4,531		4,427
Total operating expenses		21,780		19,531
Loss from operations		(21,759)		(19,499)
Other income (expense):
Interest expense		(2)		(62)
Interest income		1,668		21
Other income (expense), net		19		110
Total other income (expense), net		1,685		69
Net loss		(20,074)		(19,430)
Other comprehensive income — unrealized gain on short-term investments		126		—
Comprehensive loss	$	(19,948)	$	(19,430)
Net loss per share, basic and diluted	$	(0.40)	$	(0.44)
Weighted-average common shares outstanding, basic and diluted		50,125,685		43,969,481

The accompanying notes are an integral part of the unaudited consolidated financial statements.

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ALTIMMUNE, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

(In thousands, except share)


								Accumulated
				Additional				Other		Total
	Common Stock			Paid-In		Accumulated		Comprehensive		Stockholders’
	Shares	Amount		Capital		Deficit		Loss		Equity
Balance at December 31, 2022	49,199,845	$	5	$	568,399	$	(377,884)	$	(5,227)	$	185,293
Stock-based compensation	—		—		2,675		—		—		2,675
Exercise of stock options	19,303		—		61		—		—		61
Vesting of restricted stock awards including withholding, net	54,347		—		(484)		—		—		(484)
Issuance of common stock from Employee Stock Purchase Plan	13,215		—		135		—		—		135
Unrealized loss on short-term investments	—		—		—		—		126		126
Net loss	—		—		—		(20,074)		—		(20,074)
Balance at March 31, 2023	49,286,710	$	5	$	570,786	$	(397,958)	$	(5,101)	$	167,732

The accompanying notes are an integral part of the unaudited consolidated financial statements.

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ALTIMMUNE, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

(In thousands, except share amounts)


								Accumulated
				Additional				Other		Total
	Common Stock			Paid-In		Accumulated		Comprehensive		Stockholders’
	Shares	Amount		Capital		Deficit		Loss		Equity
Balance at December 31, 2021	40,993,768	$	4	$	497,342	$	(293,171)	$	(5,040)	$	199,135
Stock-based compensation	—		—		2,033		—		—		2,033
Exercise of stock options	95,771		—		197		—		—		197
Vesting of restricted stock awards including withholding, net	17,568		—		(170)		—		—		(170)
Issuance of common stock from Employee Stock Purchase Plan	16,450		—		113		—		—		113
Issuance of common stock in at-the-market offerings, net	335,485		—		2,990		—		—		2,990
Issuance of common stock upon exercise of warrants	1,760,854		—		—		—		—		—
Net loss	—		—		—		(19,430)		—		(19,430)
Balance at March 31, 2022	43,219,896	$	4	$	502,505	$	(312,601)	$	(5,040)	$	184,868

The accompanying notes are an integral part of the unaudited consolidated financial statements.

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ALTIMMUNE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)


	Three Months Ended March 31,
	2023		2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(20,074)	$	(19,430)
Adjustments to reconcile net loss to net cash used in operating activities:
Change in fair value of contingent consideration liability		—		(1,780)
Stock-based compensation expense		2,675		2,033
Depreciation and amortization		(356)		119
Loss on foreign currency exchange		(18)		(110)
Changes in operating assets and liabilities:
Accounts receivable		(80)		236
Prepaid expenses and other assets		1,589		3,046
Accounts payable		434		171
Accrued expenses and other liabilities		(2,827)		2,659
Income tax and R&D incentive receivables		(750)		(470)
Net cash used in operating activities		(19,407)		(13,526)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sales and maturities of short-term investments		34,565		—
Purchases of short-term investments		(21,212)		—
Purchases of property and equipment, net		(51)		(9)
Net cash provided by (used in) investing activities		13,302		(9)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments of deferred offering costs		(13)		(119)
Proceeds from issuance of common stock in at-the-market offerings, net		—		2,990
Proceeds from issuance of common stock from Employee Stock Purchase Plan		135		113
(Payments for) proceeds from share-based compensation, net		(424)		197
Net cash (used in) provided by financing activities		(302)		3,181
Net decrease in cash and cash equivalents and restricted cash		(6,407)		(10,354)
Cash, cash equivalents and restricted cash at beginning of period		111,131		190,335
Cash, cash equivalents and restricted cash at end of period	$	104,724	$	179,981

SUPPLEMENTAL NON-CASH ACTIVITIES:
Deferred offering costs in accrued expenses and other current liabilities	$	182	$	—

The accompanying notes are an integral part of the unaudited consolidated financial statements.

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ALTIMMUNE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Nature of Business and Basis of Presentation

Nature of Business

Altimmune, Inc., headquartered in Gaithersburg, Maryland, United States, together with its subsidiaries (collectively, the “Company” or “Altimmune”) is a clinical stage biopharmaceutical company incorporated under the laws of the State of Delaware.

The Company is focused on developing treatments for obesity and liver diseases. The Company’s pipeline includes next generation peptide therapeutics for obesity and non-alcoholic steatohepatitis (“NASH”) (for both, pemvidutide, formerly known as ALT-801), and for chronic hepatitis B (“HepTcell^TM”). Since its inception, the Company has devoted substantially all of its efforts to business planning, research and development, recruiting management and technical staff and raising capital, and has financed its operations through the issuance of common and preferred stock, long-term debt and proceeds from research grants and government contracts. The Company has not generated any revenues from the sale of any products to date, and there is no assurance of any future revenues from product sales.

Basis of Presentation

The accompanying unaudited consolidated financial statements are prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States (“U.S. GAAP”) for complete consolidated financial statements and should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2022 included in the Annual Report on Form 10-K which was filed with the SEC on February 28, 2023. In the opinion of management, the Company has prepared the accompanying unaudited consolidated financial statements on the same basis as the audited consolidated financial statements, and these consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year 2023 or any future years or periods.

The accompanying unaudited consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

The accompanying unaudited consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets, and the satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets and liabilities that might be necessary should the Company be unable to continue as a going concern.

2. Summary of Significant Accounting Policies

During the three months ended March 31, 2023, there have been no significant changes to the Company’s summary of significant accounting policies contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 as filed with the SEC, except for the recently adopted accounting standard for ASU No. 2016-13 as disclosed below.

Use of Estimates

The preparation of these financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates and assumptions made in the accompanying condensed consolidated financial statements include, but are not

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limited to, the valuation of share-based awards, income taxes, and accruals for research and development activities. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable. However, actual results could differ from those estimates and there may be changes to the Company’s estimates in future periods.

Short-term Investments

The Company’s short-term investments are comprised of U.S. Treasuries, corporate debt securities and certificates of deposit that have original maturities less than or equal to one year and are classified as available-for-sale (“AFS”) securities. Such securities are carried at estimated fair value, net of allowance for credit loss determined based on the Current Expected Credit Loss. Any unrealized holding gains or losses are reported as accumulated other comprehensive income or loss, which is a separate component of stockholders’ equity. In the event that the AFS security's fair value is below the amortized cost and (i) the Company intends to sell the AFS security and (ii) the AFS security is required to be sold before recovery of the loss, the AFS security's amortized cost base will be written down to its fair value and the loss will be recognized in the income statement. If the Company intends not to sell the AFS security and the AFS security is not required to be sold before recovery of the loss, the Company evaluates whether a portion of the unrealized loss is a result of credit loss. The portion of unrealized loss related to credit loss will be recorded as allowance for credit loss in the balance sheet with the corresponding credit loss in the income statement and the portion of unrealized loss not related to credit loss will be recognized in other comprehensive income (“OCI”). Dividend and interest income are recognized in other income when earned. The cost of securities sold is calculated using the specific identification method. The Company places all investments with government agencies, or corporate institutions whose debt is rated as investment grade. As of March 31, 2023, none of the unrealized losses on our short-term investments are a result of credit loss, and therefore, the unrealized losses were recognized in OCI.

Income Taxes

Due to a full valuation allowance, the Company did not record an income tax expense (benefit) for either of the three months ended March 31, 2023 or 2022. The Company calculates its quarterly income tax provision based on an estimated, annual effective tax rates applied to ordinary income (or loss) and other known items computed and recognized as they occur. The Company’s total provision is based on the United States statutory rate, increased by state and foreign taxes and reduced by a full valuation allowance on the Company’s deferred tax assets.

Recently adopted accounting pronouncements

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU No. 2016-13”). ASU No. 2016-13 requires financial assets measured at amortized cost to be presented at the net amount expected to be collected and any unrealized loss relating to available-for-sale debt securities to be recorded through an allowance for credit losses. The Company adopted this new accounting standard on January 1, 2023 using a modified retrospective method. Adoption of this update did not have a material impact on the Company’s financial statements and related disclosures.

3. Fair Value Measurements

The Company’s assets and liabilities measured at fair value on a recurring basis as of March 31, 2023 consisted of the following (in thousands):


	Fair Value Measurement at March 31, 2023
	Total		Level 1		Level 2		Level 3
Assets:
Cash equivalents - money market funds	$	100,611	$	100,611	$	—	$	—
Short-term investments		61,039		—		61,039		—
Total	$	161,650	$	100,611	$	61,039	$	—

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The Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2022 consisted of the following (in thousands):

SEC Form 10-Q filed by Altimmune Inc.